Publication: When Job Earnings Are Behind Poverty Reduction
Date
2012-11
ISSN
Published
2012-11
Abstract
Improvement in labor market conditions
has been the main explanation behind many of the poverty
success stories observed in the last decade, that is the
primary conclusion of an analysis of changes in poverty by
income source. Changes in labor earnings were the largest
contributor to poverty reduction for a sample of 16
countries where poverty increased substantially. In 10 of
these countries, labor income explained more than half of
the change in poverty, and in another 4 countries, it
accounted for more than 40 percent of the reduction in
poverty. A declining dependency rate accounts for over a
fifth of the reduction in poverty in 10 out of 16 countries,
while transfers and other non-earned incomes account for
more than a quarter of the reduction in poverty in 9 of
these countries. A further decomposition of the contribution
of labor income to poverty reduction in Bangladesh, Peru,
and Thailand found that changes in individual
characteristics (education, work experience, and region of
residence) were important, but that overall, increases in
real earnings among the poor matter the most.
Citation
“Inchauste, Gabriela; Azevedo, João Pedro; Olivieri, Sergio; Saavedra, Jaime; Winkler, Hernan. 2012. When Job Earnings Are Behind Poverty Reduction. Economic premise;no. 97. © World Bank, Washington, DC. http://hdl.handle.net/10986/17067 License: CC BY 3.0 IGO.”